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The Globe and Mail

Netflix launches streaming video in Canada

Netflix CEO Reed Hastings shows off their new set top box at Netflix headquarters in Los Gatos, Calif., Friday, May 16, 2008.

Paul Sakuma/AP

Netflix launched an online video-streaming service in Canada for movies and television shows on Wednesday, its first foray outside the United States.

Adding another content provider to an increasingly congested market, Netflix said it will offer unlimited streaming of movies, documentaries and TV shows for $7.99 a month.

Consumers will be able to stream video to their TVs or computers. Video game consoles such as the Nintendo Wii, the Sony PlayStation, and devices such as the iPhone and the iPad will all be able to stream from Netflix.

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The company said it has signed licensing agreements with studios including Lionsgate, MGM, Sony, 20th Century Fox as well as Canadian distributors, Alliance Films, Maple Pictures, eOne, and Mongrel.

Netflix's entry into Canada represents another rival for established cable- and satellite-TV companies, as well a competitor for Apple Inc.'s iTunes service. It will also be streaming over networks owned by Internet providers that may offer similar services.

Netflix Chief Executive Reed Hastings played down the threat to established players at a press conference on Wednesday.

"We're not really an effective competitor to cable because we don't have sports, we don't have the vast majority of programming that cable has. We're like a bicycle compared to their car."

Hastings said file size would average around 1 gigabyte per hour. While Netflix's subscription model offers unlimited access for a flat fee, most customers' use of the service will be restricted by the data limits set by their Internet service providers.

Hastings dodged a suggestion that major Internet providers such as BCE Inc.'s Bell Canada unit and Rogers Communications , had reacted to Netflix's imminent arrival by reducing bandwidth limits in some Internet plans for new subscribers.

"Netflix streaming is very efficient in how little data it uses," he said. "We hope it won't be a significant problem."

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Canada has seen a growing convergence in its telecoms sectors in recent years as telephone and cable companies compete directly for phone, wireless, Internet and broadcasting services, as well as media content.

The county's biggest telecom company, BCE, said earlier this month it would buy CTV, the country's biggest private broadcaster, for C$1.3 billion as it moved to bolster its position as a content provider.

BCE already offers a satellite TV service and is now starting to roll out Internet TV.

Cable company Shaw Communications said earlier this year it would buy the television assets of Canwest Global Communications, which is under bankruptcy protection.

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